Financial planning during a job search

March 15th, 2007 by The Imagination Factory

When you are engaged in a job search, whether active or passive, you will probably be involved in a different economic situation. Some of you may be sole breadwinners while others may have spouses who are currently employed. Some of you may be fortunate enough to have excellent severance packages, while others have nothing at all. Regardless of your circumstances, what we do know is that it is impossible to predict when your ideal job offer and ultimate acceptance will come. Therefore, we strongly suggest that you initially conduct a financially planning assessment to review on-going and other anticipated and financial needs. If you do have a family it is important to include your spouse in order for both of you to understand and agree how to best handle money matters until you are once again employed.

Regardless of your situation, you should always consider doing the following:
1. Immediately reduce or eliminate spending on non-essential items! (This will be difficult in the beginning. However, once you make a conscious effort in this area it becomes easier.)

2. Delay expenditures on essential items until absolutely necessary. You need to then do your homework! You need to take into account what is your present cash situation. This is considered your “cash inflow.”

This includes: any Severance Package Money, Investment Income – including Checking and Savings Accounts/Interest. It also includes Bonds/Interest Capital Gains, Dividends, Rental or any trust income. Other sources include any Retirement Income – Social Security, Pensions, Unemployment Alimony or Child Support. This includes an estimate of any other cash that comes in on a regular basis. (This is money that you can count on every month.)

Your next step is to get a realistic projection of your expenses. This is considered your “cash outflow.” These are typical expenses that are routinely incurred by most people. Also keep in mind that you will incur some expenses from your job search itself!

The following should be considered: All Outstanding Bills or other Debts, Interest on Debts, Mortgage or Rent, Property Taxes, Groceries, Utilities – gas, water, electric. Other expenses are Phone, Cable, Cell phone, Garbage Maintenance, Clothing, Auto Expenses – gas, oil, etc. any Transportation, any Entertainment, any Tuition, and Dry Cleaning, Personal Items, any Prescriptions, Children Expenses – lessons, school, etc. The other expenses to consider are Life Insurance Premiums, Medical Insurance Premiums and Auto Insurance Premiums.

Once you have put all of your information on paper (or on a spreadsheet.) You will then be able to gain perspective on where you are financially, and how you will “maintain” your living expenses while you are conducting your job search. If you don’t have a plan, your finances can get “out of control.” While you are conducting a job search the last thing you want to be is “out of control of anything!” If you know where you are, and you know what direction you are going, your job search will remain your TOP PRIORITY! If your priority is your job search, your finances will not be an issue!

Nancy J. Phillips, CPC
Courtesy of: Good as Gold Training, Inc. (

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